India State-Run Banks Slide as Fuel Prices Jump 7% and Bond Yields Climb

1 articles · Updated · Bloomberg · May 25

India’s state-run bank shares fell as rising bond yields pressured lenders already exposed to government securities.
A roughly 7% increase in retail fuel prices — the fourth hike in less than two weeks — raised the risk of faster consumer inflation and possible RBI rate hikes, helping drive yields higher.
The rupee may be undervalued after its recent depreciation, RBI Governor Sanjay Malhotra said, an unusual public comment on currency valuation from the central bank.
Oil prices eased on signs Washington and Tehran are nearing a deal to reopen the Strait of Hormuz, though Donald Trump said he would not rush an agreement.
That backdrop also brought a supply signal for India: an LPG ship exited the Strait of Hormuz, the first Persian Gulf cargo for the country since the war began.

As soaring fuel prices hit consumers, why is India's central bank choosing to wait on raising interest rates?

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